Time for Me to Fly: Predicting Director Exit at Large Firms
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One of the great unanswered questions in governance research is, Why do directors serve on boards? Drawing on self-determination theory, a theory of total motivation that combines both intrinsic and extrinsic motivations, we find that the prestige associated with being a director, the ability to have influence, and identification with the director role make directors less likely to exit; however, demotivating factors related to the time commitment required, such as holding other board appointments or serving as a CEO at another company, increase the likelihood of director exits. Finally, we find that the value of being on the board of a prestigious firm diminishes when the firm experiences events that tarnish its prestige, although these same events decrease the likelihood of director exit when firm prestige is lacking. Academy of Management Journal.